[World Tax News] Switzerland to Implement Iir From 2025 | No UTPR for the Time Being and More

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  • Last Updated on 16 January, 2025

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World Tax News provides a weekly snippet of tax news from around the globe. Here is a glimpse of the tax happening in the world this week.

1. Switzerland to implement IIR from 2025; No UTPR for the time being

In 2023, the people and the cantons voted in favour of the Federal Council introducing the OECD/G20 minimum tax rate in Switzerland. The main aim is to prevent Switzerland from foregoing tax receipts in favour of foreign countries. The Swiss supplementary tax (QDMTT), which the Federal Council introduced in 2024, serves this purpose.

During its meeting on 4 September 2024, the Federal Council decided to bring the income inclusion rule (IIR) into force with effect from 1 January 2025. This international supplementary tax will complement the Swiss supplementary tax (QDMTT) already introduced in 2024. With this international supplementary tax, the profits of foreign subsidiaries of Swiss corporate groups, as well as those of intermediate holding companies of foreign corporate groups, are taxed at 15%, provided the corporate group’s global annual turnover is at least EUR 750 million.

By implementing the IIR, Switzerland can secure receipts that can then be used to strengthen the country’s attractiveness as a business location. However, the Federal Council has decided to refrain from implementing the UTPR for the time being, as it believes that the risks associated with such a move would outweigh the revenue potential of a UTPR.

Source: Press Release by the Federal Council

2. Taiwan announces increased AMT for MNE groups subject to Pillar 2 global minimum tax

Taiwan’s Ministry of Finance has proposed draft revisions to the income basic tax rate, also known as the alternative minimum tax (AMT), in response to the Pillar 2 global minimum tax. Beginning in 2025, the AMT rate for Taiwanese enterprises that are part of multinational enterprise (MNE) groups subject to Pillar 2 rules is set to increase from 12% to 15%. These rules apply to groups with consolidated annual revenues exceeding EUR 750 million in any two of the previous four years.

Taiwanese companies that are not part of such MNE groups will continue to be subject to the 12% AMT rate. The increase aims to mitigate the risk of these enterprises having to pay supplementary global minimum taxes in other countries.

Source: Announcement by Ministry of Finance

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Author: Taxmann

Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.

The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:

  • The statutory material is obtained only from the authorized and reliable sources
  • All the latest developments in the judicial and legislative fields are covered
  • Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
  • Every content published by Taxmann is complete, accurate and lucid
  • All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
  • The golden rules of grammar, style and consistency are thoroughly followed
  • Font and size that's easy to read and remain consistent across all imprint and digital publications are applied